Copper, was the worst performing commodity in the base metals pack yesterday as it declined around 1 percent on the LME. The metal came under pressure on the back of slow GDP growth in the US. Additionally, LME copper inventories rose by 1.6 percent and stood at 230,675 tonnes. A stronger dollar index too exerted downside pressure on the red metal. Copper traders are the most bearish since September and hedge funds are betting on price declines as concern that Europe’s debt crisis is deepening drove the metal to the lowest this year. The metal slid the most since September in May as concern about Greece’s future in the euro and spreading of the region’s crisis grew.

MCX Copper Trend

From an intra-day perspective we expect base metals to trade with a negative bias today on the back of rise in risk aversion in the global markets. Additionally, latest data from China showed a fall in the manufacturing PMI, indicating a slowdown in the Chinese economy which is the major consumer of base metals. This news will act as a bearish factor for base metals today.

Technically chart of Copper suggest that prices have breached the bottom to bottom rising trend line. RSI is in a sell mode. We expect prices to correct up to levels of 413.